Design, Tech, Art, and Business

Which is best: Incubators or Venture Capitalists?

#Incubators were once the sleepy domain of universities and public development agencies.

However, business incubators show life in the internet era. Focused on providing new ventures not just with funding, but also with services, advice, connections, and physical space, they offer a new way for dot.com companies to get to market fast. We are beginning to see a major shift from the traditional #venturecapitalcommunity. Instead of separate synergies, the start-up community is looking to work together harmoniously like never before.

Although the forms of their organizations vary in large and small ways, one thing all the participants agreed on was that incubators are catching on in part because it takes more than just funding to get a startup successfully off the ground in the digital economy.

New entrepreneurs consider VC’s a means to an end, declaring it’s not difficult to “put money together.” However, in the incubator realm, it’s not about probability or chance like it is in the venture capital sector. VC’s don’t have people to spend time in the trenches.

There are very different skill sets for each.

Traditional venture capital firms need to move in either one of two directions: view it as a commodity and orient themselves much like a bank, a lending company, or an equity transaction company, or move up the food chain and be able to provide richer, higher services much like we see in the incubation space today.

Cost for closer involvement is higher, but at a higher reward or guarantee on return. Incubators are experiential, not “just dumb money”.

So what is that one thing that startups can use at an early stage to take lead and have a chance at becoming the next big thing?

As incubators and accelerators are harder and harder to get accepted into, and it’s becoming impossible to successfully complete an idea without offering equity to others, there is still a solution which startups can implement to bring their ideas to life in the most successful way:

Consultants.

Using a consultancy is seeking help and redefining your vision and your product in a way that you do not end up losing your chance at becoming a successful company, but also owning complete rights over the domain name.